Archive for November, 2010|Monthly archive page

Dilma Rousseff’s economic team reassures suddenly nervous investors that it will indeed stick to fiscal and monetary rectitude (The Economist).

After weeks of speculation, Brazil’s president-elect Dilma Rousseff has finally confirmed that she will be changing the central bank’s governor, paving the way for big interest rate cuts. Forcing the departure of inflation hawk Henrique Meirelles is Ms Rousseff’s most decisive move so far (BBC).

Brazil’s incoming economic policy team surprised financial markets by promising deep cuts to budget spending, moving to shore up the main weakness in the country’s booming economy (Reuters).

Brazil may be one of the world’s hottest emerging markets, but there is at least one area in which it is not yet ready for prime-time — infrastructure. President-elect Dilma Rousseff will have to make vast regulatory improvements and boost incentives for private-sector investment in overstretched roads, ports and airports if Brazil is to sustain the commodities-driven growth of recent years (Reuters).

Brazil’s government must immediately adopt tough measures to reverse a currency rally and rising imports of manufactured goods that are stripping its businesses of market share. National Industry Confederation chief Robson Andrade said the government must adopt restrictions, including nontariff barriers, to halt mainly Chinese imports that were eliminating domestic jobs (Reuters).

Wall Street favorite Antonio Palocci is to become the chief of staff in the incoming government of Brazilian President-elect Dilma Rousseff, an influential position that is likely to please financial markets (Reuters).

A Lula da Silva Institute will be fully involved in Africa, the world’s poorest continent, and President Lula will be fully dedicated to that task when he steps down from office next January first (Mercopress).

INTERNATIONAL

The Brazilian government questioned UK’s “unilateral actions” regarding the (Falklands) Malvinas Islands and called for the sovereignty “long standing dispute” to reach “as soon as possible a solution” (Mercopress).

Bridges, railroads, petrochemicals, steel mills, electricity, aqueducts, agriculture, meat-processing plants, ship building and even cable cars: Brazil’s powerful entrepreneurial arm is reaching towards the Caribbean, via Venezuela, where the Hugo Chávez government is working to build what it calls “21st century socialism” (IPS).

Iran’s greatest achievement in Latin America is its strong ties with oil-rich Venezuela and its burgeoning friendship with rising great power Brazil. This bid for greater influence in the U.S. backyard has not yet led to a direct confrontation. But with a nuclear agreement still up in the air, Iran’s “Latin connection” may well pose an unwelcome challenge to the Obama administration (Foreign Policy in Focus).

President Luiz Inacio Lula da Silva said Eletricas do Norte do Brasil SA plans to build a hydroelectric power plant on the border with Guyana. The two South American countries signed a memorandum of understanding to determine where the plant will be located, Lula said during a speech in Georgetown, Guyana (Bloomberg).

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DEFENSE

The Brazilian navy is planning to build and incorporate in the next decades a fleet of six nuclear powered and 20 conventional submersibles (15 new and five refurbished), making it the most dissuasive fleet of South America (Mercopress). More information on the submarines can be found at Defense Industry Daily, including news about the submarine base to be built in Itaguai.

Scorpene-class submarine (Source: DCNS)

Defense Minister Nelson Jobim said that “transfer of technology” will be the main factor in the government’s decision on the purchase of 36 fighters for the Air Force (FAB). The Minister added that France has “a more credible offer” in this regard. He said the choice between competitors from France, Sweden and the United States will be announced before Dec. 19. According to Jobim, President Lula has said he wants to have a meeting in the next weeks. Jobim present the three competitors and the decision will be taken by Lula in agreement with president-elect Rousseff. In fact the Brazilian political year ends on December 19 with a long holiday break, so the policy decision has to be taken before that date (BW).

Boeing is offering to partner with Brazil’s Embraer on a new fighter jet, in an effort to strengthen its bid for a multi-billion-dollar Brazilian defense contract. Joseph McAndrew, Boeing’s vice president for Europe, Israel and America, told business publication Valor that the firm proposed 10 partnership projects with Brazil’s aviation leader, including building a new plant in the country to build parts for Boeing’s F/A-18 Super Hornet (Defensenews).

South Korea’s Daewoo Shipbuilding & Marine Engineering (DSME) has entered discussions with the Brazilian Navy about its requirement to procure frigates, offshore patrol vessels (OPVs) and logistics support ships, Jane’s understands. A source close to the development said on 18 November that DSME put forward a detailed formal proposal to meet the requirements in late September and that a series of meetings has taken place (Janes).

Spanish company Tecnobit has secured its biggest military simulation contract to date, to develop and equip two artillery simulation centres for the Brazilian Army. The deal, signed at the Brazilian Army’s HQ on 9 November by Army Chief of Staff General Enzo Martins Peri and Tecnobit president Luis Mayo, is also the first to take place directly between the army and a Spanish company (Janes).

President-elect Dilma Rousseff’s government may create an agency or secretariat for aerospace. The agency would report directly to the presidential palace. Currently, aerospace issues are distributed across several government bodies reporting to different ministries (Bloomberg).

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Brazil is no stranger to boom-and-bust cycles, having watched one economic leap after another descend into crisis throughout its history. Those days look long gone. Now, instead of joking about their country’s chronic inability to live up to its potential, Brazilians of all political stripes are boldly staking claim to a starring role in global economic affairs. Read the full analysis at Reuters.

Although 50 percent margins on certain products may seem outrageous, a closer look into the business landscape in Brazil may explain how high taxes, complicated regulations, workforce costs generate risks and real costs that drive up the final price of products and services (The Rio Times).

Brazil is the country that has the highest tax burden among the BRICs (Brazil, Russia, India and China). The total taxes, levies and contributions collected in the country is 34% of Gross Domestic Product (GDP). In Russia, the charge is 23% of GDP in China is 20% and in India, a country whose tax structure is more like the Brazilian, the total revenue amounts to 12.1% of GDP (India-Brazil Chamber).

Foreign direct investment in Brazil soared to 6.8 billion US dollars in October, the highest for the month since records were started. This was higher than last month with 5 billion and four times October a year ago with 1.6 billion, according to the latest release from the central bank (Mercopress).

Brazil’s current account gap widened to a record in the year through October as credit expansion and record low unemployment boosted imports and spending by Brazilians abroad. The deficit in the current account, the broadest measure of trade and services, was $3.7 billion in October, pushing the annual gap to a record $48 billion, the central bank said (Bloomberg).

Companies that aim to take over rivals through bidding in the stock market will face tighter oversight to protect minority investors from risks such as asymmetric information and scant transparency (Reuters).

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AVIATION

Embraer has commenced the first phase of its new construction project in Évora, Portugal, a 330,000-square-foot (30,660-square-meter) facility dedicated to manufacturing complex airframe structures and components in composite materials. The completion of this unit is scheduled for the end of 2011, while the production phase will start in 2013 (Embraer, pdf).

The chief of the International Air Transport Association or IATA sharply criticized the poor condition of Brazil airports, saying that the situation could put the country in a very bad light during the World Cup and the Olympic Games if the government does not improve capacity and renovate aging infrastructure (Mercopress).

Brazil’s National Civil Aviation Agency (ANAC) announced it would punish airlines which overbook during the holiday season. The measure, to take effect from Dec. 17 to Jan. 3, is part of a contingency plan to avoid chaos in the country’s airports during the season (Xinhua).

AGRI

Global sugar supplies may fall short of demand next year as Brazil, the world’s largest exporter of the sweetener, razes and replants enough farmland to cover the state of Connecticut. Producers in the Center South, Brazil’s main producing region, plan to replant about 1.4 million hectares (3.5 million acres), or 20 percent of their farmland, to replace aging plants (Bloomberg).

HIGH SPEED

A consortium of Japanese companies led by Mitsui & Co will not take part in a tender by the Brazilian government for a high-speed railway project expected to cost around $19 billion. The group made the decision amid uncertainty over whether the project would be profitable over 40 years, during which time the companies would hold management responsibility (Reuters).

BANKING

Brazilian industrial conglomerate Camargo Correa agreed to sell its stake in holding company Itausa for about $1.5 billion. The likeliest buyer of Camargo’s holdings in Itausa could be Petros, the pension fund of state-owned oil company Petrobras’ workers (Reuters).

The controlling shareholders of Banco PanAmericano, the Brazilian bank that received an emergency 2.5 billion real ($1.5 billion) capital injection last week, said the bank is not for sale as speculation mounts of possible bids for the lender (Reuters).

BIOFUELS

Data from the U.S. Environmental Protection Agency (EPA) shows that eight Brazilian sugarcane processing mills have already completed the paperwork required by the U.S. government for their ethanol to be accepted into the United States as an “advanced renewable fuel,” as called for by the Renewable Fuel Standard (RFS) (UNICA).

MINING

Vale SA’s biggest shareholder, the Brazilian pension fund Previ, doesn’t plan to substitute Roger Agnelli as chief executive officer, Folha de S.Paulo said, citing an interview with Previ President Ricardo Flores. Flores will work to improve the relationship between the company and the Brazilian government (Bloomberg).

OIL

Ecuador took control of the local operations of Brazil’s Petrobras after the company refused to sign a new service contract (Reuters).

President-elect Dilma Rousseff is likely to keep Jose Sergio Gabrielli as chief executive of oil group Petrobras for at least another year to help boost the government control of the nation’s oil wealth (Reuters).

Picture: Petrobras CEO Sergio Gabrielli (Petrobras picture)

Brazilian state oil company Petrobras’ refining investments are crucial to ensuring Brazil’s long-term energy supply as fuel consumption soars in fast-growing nations such as India and China, CEO Jose Sergio Gabrielli said (Reuters).

REAL ESTATE

Agente Imóvel, a website dedicated to real estate, compared the average price of one bedroom apartments in the main Brazilian state capitals. It concluded that Brasília is the most expensive, four times more than nearby Goiânia.

PDG Realty, Brazil’s largest real estate developer, sees no risk of a bubble in the country’s housing market despite surging sales and a red-hot economy (Reuters).

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Render of an administrative building in Cone Suape, the urban project to surround the massive Port and Industrial complex of Suape near Recife, PE. A project worth 1,4 billion reais and financed by the BNDES (BW).

SPORTS

Football clubs in Brazil and other South American nations have traditionally sold their best players to Europe and other parts of the world in order to balance their books. But now many believe the trend is changing in Brazil, with clubs seeking to run themselves better and not be forced to cash in on their best assets every year (BBC).

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BRASILIA

Brasilia has hit back at suggestions Sao Paulo will host the opening game of the 2014 World Cup, quoting a letter from soccer’s world governing body FIFA which says the contest is still open (Reuters).

RIO

Police in Rio de Janeiro say they now have total control of the Vila Cruzeiro shanty town, as they continue a crackdown on violent drug gangs. Security forces earlier deployed armoured vehicles, transporting armed police, into Vila Cruzeiro, in the north of the city. The offensive comes after five days of clashes which have killed at least 30 people (BBC).

Sports and tourism expert Jeanine Pires is heading up the new government organization – Brasil 2016 – that will coordinate the various infrastructure projects and other aspects associated with the 2016 Olympic Games in Rio de Janeiro (BBC).

Arpoador, located in Zona Sul between the fort of Copacabana and Ipanema beach, spans just over 500 meters of coastline. As the natural separation point between Copacabana and Ipanema beach, the Arpoador Rock provides beautiful views of Rio’s most famous beaches. The Rio Times takes a closer look.

Local correspondents help you get the most out of a stay in Brazil’s former capital which was also once the capital of the Portuguese empire. Read Reuters‘s advice on what to do with your 48 hours in Rio.

With the world’s two biggest sporting events – the World Cup and the Olympic Games – set to be staged in Brazil within the next six years, the country is hoping to use the events to their economic advantage. The BBC reports from Soccerex in Rio.

RIO GRANDE

Rio Grande (RS) in south Brazil is geared to become “Mercosur hub and main port”. The port city has rapidly become the main competitor of the port of Montevideo based on a sustained expansion, deep dredging, the construction of new piers and update equipment (Mercopress).

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SAO PAULO

Perhaps because of the international success of the Brazilian film ”City of God”, for many the word favela is synonymous Rio de Janeiro, more so than São Paulo. But Brazil’s largest city struggles with the same challenges, and the census at the turn of the century recorded that a third of the city’s population were living in the over 600 favelas within and around the city (The Rio Times).

FIFA president Sepp Blatter is set to visit Brazil next month to check the progress the twelve cities are making with their respective stadiums. The former lawyer, 72, is particularly concerned about the state of affairs in São Paulo, where none of the current stadiums meet the required standards (The Rio Times).

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Brazil’s ruling Workers Party’s main ally in Congress Brazilian Democratic Movement, PMDB, has formed its own legislative group hoping to dispute some of the most strategic posts in the new congress that takes office next January first (MercoPress).

Guido Mantega’s goal in the next government is to reduce net debt to about 30 percent of gross domestic product by 2014 (Bloomberg).

As Brazil’s longest-serving central bank governor, Henrique Meirelles has been keeping his steely eye on the country’s inflation rate for nearly eight years. But with the country preparing for Lula’s successor, it appears that Mr Meirelles’ single-mindedness may have fallen out of fashion in political circles (BBC).

President-elect Dilma Rousseff was a creation of President Lula da Silva and could fall prey to the temptation of a populist system, said French Sociologist and political scientist Alain Touraine currently visiting Sao Paulo (MercoPress).

“If Brazil’s President-elect Dilma Rousseff wants to foster investment to sustain economic growth and accelerate the convergence between domestic and international interest rates without stoking inflation, she needs to keep former Finance Minister Antonio Palocci in the government’s decision-making nucleus. Anything else would be an unparalleled waste and an irreparable mistake”. Read the column by Alexandre Marinis at Bloomberg.

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INTERNATIONAL

Bilateral trade among Mercosur main partners, Argentina and Brazil is expected to reach a “historic record” of almost 34 billion US dollars this year, 80% of which mostly manufactured goods, according to Argentine Industry minister Deborayh Giorgi, who also anticipated that the deficit would drop 30% (MercoPress).

Brazil’s Foreign Trade Chamber (Camex) announced a new credit line for African food producers to purchase tractors and other farm machinery in the country (Xinhua).

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Brazil spends a paltry 1.1% of its GDP on research and development compared with 1.4% in China and 3.4% in Japan. Last year Brazil fell 18 places in Insead’s annual innovation index, from 50th to 68th. Worse still, its ratio of basic-product to manufactured-product exports was the highest since 1978. These figures confront Brazilians with a troubling question. Can their country become an innovator in its own right, or is its recent growth little more than a by-product of China’s appetite for commodities? Read on at The Economist.

Importers face new barriers in Brazil. Customs valuation is the most recent measure Brazil has taken to, quietly, contain the flood of imports. The government wants to escape from the label of “protectionist” and has been avoiding to simply raise import tariffs. The country resorted to other strategies, more sophisticated, which produce the same effect (India-Brazil Chamber).

International investors have pulled the plug on 6 billion reais (US$3.5 billion) in Brazilian timber investments after the Attorney General issued a finding limiting foreign investments in land (Reuters).

AVIATION

Embraer and China’s AVIC International Leasing Co., Ltd. (AVIC Leasing), jointly announced the signing of a Memorandum of Understanding on aircraft financing and leasing during the press conference held today at the eighth China International Aviation & Aerospace Exhibition, in the city of Zhuhai, Guangdong Province, China. The agreement could come to as much as US$ 1.5 billion over the next five years (Embraer, pdf).

In line with the expansion of China’s aviation market and economic development, Embraer forecasts a total demand of 950 new regional jets over the next 20 years, consisting of 20 for 30-60 seats, 425 for 61-90 seats, and 505 for 91-120 seats (Embraer, pdf).

TAM is the most profitable airline company in Latin America and the United States (Xinhua).

BIOFUELS

BP has bid 800 million reais ($466 million) for a 50 percent stake in Brazil’s Cerradinho sugar and ethanol group (Reuters).

Clear definitions of the remaining sustainability criteria for biofuels entering Europe will allow the sugarcane industry in Brazil to develop comprehensive certification schemes that fully meet European requirements. The position was detailed by the Brazilian Sugarcane Industry Association (UNICA) at a roundtable on Moving towards the implementation of sustainable criteria for biofuels, which took place in Brussels on November 16, organised by Brazil’s mission to the European Communities (UNICA).

BANKING

For a central banker to boast of the discovery that a bank he supervises has been overstating its assets, probably for years, it takes some chutzpah. But that is how Henrique Meirelles, the governor of Brazil’s Central Bank, presents a 2.5 billion reais ($1.5 billion) hole in the accounts of Banco PanAmericano, a medium-sized lender. He may even be justified (The Economist).

Banco BMG, the Brazilian lender specialized in consumer loans, has “a great chance” of taking over rival Banco PanAmericano, which last week received an emergency capital injection engineered by the central bank (Reuters).

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HOTELS

Marriott International Inc. plans to boost its hotel count in Brazil to 54 from four. The company will develop 50 Fairfield by Marriott hotels throughout Brazil in a partnership with Rio de Janeiro-based real estate developer PDG Realty SA Empreendimentos & Participacoes (Bloomberg).

MINING

Vale said it will launch an offer to pay up to $3.3 million to buy outstanding common shares of a fertilizer company it bought part of earlier this year (Reuters).

Vale said it plans to invest more than C$10 billion ($9.8 billion) in Canada over five years to increase metals and fertilizer output (Bloomberg).

OIL

The state of Rio de Janeiro has asked the nation’s top court to declare the unconstitutionality of state oil company’s Petrobras oil-for-shares swap with the Brazilian government (Reuters).

Petrobras’ CFO Almir Barbassa

Petrobras could sell off foreign refining assets as it seeks to focus on Brazil’s giant offshore crude reserves (Reuters).

Petrobras expects crude oil exports to rise to 800,000 barrels per day by 2020 as new oil production from vast offshore fields comes online (Reuters).

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Render of the 156 metres high Universe Life Square tower for Curitiba city centre (more).

MEDIA

Brazil is drafting a media bill that is geared to stimulate the participation of common citizens in the communications industry and preventing market rules from governing such a sensitive area, announced Social Communications minister Franklin Martins (MercoPress).

CITIES

Regina Scharf explains the seven things you should know before driving your car through a Brazilian city (Gringoes).

The Amazon forest, the world’s largest rainforest, enjoyed an international reputation for its exuberant fauna and flora, miles-wide rivers and native Indian tribes. But few people know that Manaus, the main city in the heart of this jungle, is consolidating itself as a world-class center for arts and is heavily investing in the entertainment industry (Xinhua).

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According to the 2006 census, people of East Asian descent number 919,000 in Brazil, or just 0.5 percent of the national population. In Rio’s Zona Norte neighborhood of Tijuca, local residents are noticing an increasing presence of Chinese businesses, adding to the cultural diversity of the area (The Rio Times).

From the legendary shores of the Mediterranean to the curved Copacabana beachfront, the iconic Ibiza island (off the coast of Spain) bar and chill-out music pioneers Café del Mar opened the first Latin American outpost this month on Rio’s Avenida Atlântica (The Rio Times).

SAO PAULO

Often over shadowed by the picture postcards of Rio and it’s famous coast line, the beaches in São Paulo State are popular with Paulistas and offer a variety of choice for the summer holidays, without having to travel far from Brazil’s largest city (The Rio Times).

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As Brazil’s President-elect Dilma Rousseff gets ready to take the helm of Latin America’s largest economy on New Year’s day, speculation is rife about who she will pick for finance minister and central bank chief. Read the possible scneario’s for whom becomes finance minister at Reuters.

Brazil has room to raise the country’s minimum wage next year more than the 5.5 percent increase the government is proposing, said Senator Gim Argello, the lawmaker sponsoring the 2011 budget bill in Congress (Bloomberg).

Luciano Coutinho would like to stay on as president of Brazil’s state development bank after President-elect Dilma Rousseff takes office Jan. 1, Veja magazine reported. Coutinho is among candidates being by considered Rousseff for key positions in her Cabinet (Bloomberg).

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INTERNATIONAL

Britain is to support Brazil’s campaign to be named a permanent member of reformed UN security council as part of a Foreign Office drive to transform trade and diplomatic ties with Latin America (Telegraph).

Mexico and Brazil are starting negotiations on a free trade agreement between Latin America’s two largest economies (Business Week).

China and Brazil may expand an oil- for-loans program to intensify energy cooperation, China Business News reported (Bloomberg).

The Interoceanic Highway, connecting Brazil to Peru, should be inaugurated in early 2011, said the first class minister Carlos Alfredo Lazary Teixeira (Senado Federal).

Lula, who is in the final weeks of his presidency, is bidding farewell to Africa, the continent he made a foreign policy priority during his eight years in office. The number of Brazilian embassies in Africa has more than doubled to 35, while bilateral trade increased fivefold to $26bn (£16bn) last year (BBC).

Under Lula’s watch, Brazil-Turkey political and economic ties have flourished, and cooperation has strengthened. Petrobras, Brazil’s oil giant, has begun collaborating with the Turkish Petroleum Corporation (TPAO) in the Black Sea, and Turkish companies are increasingly eyeing the Brazilian market. In addition, Lula and Turkish Prime Minister Recep Tayyip Erdoğan have both agreed on the necessity to challenge existing geopolitical paradigms and involve new players to address global challenges more effectively Oliver Stuenkel in Post-Western World).

South Korean President Lee Myung-bak and his Brazilian counterpart Luiz Inacio Lula da Silva pledged to bolster bilateral trade and investment. The two presidents made the pledge during their talks on the sidelines of the G20 Economic Summit in Seoul, according to Lee’s office Cheong Wa Dae (Xinhua).

An Internet portal will bring together information about companies in India, Brazil and South Africa, aiming to transform Indian companies and South African in Brazil integrative solutions in their projects in both the U.S. and Europe and Asia. The project is the result of an agreement of national export promotion in Brazil and India’s Nasscom, which brings together 1300 members and South African BPES, with 220 others (India-Brazil Chamber).

Brazil’s North East is home to a large international airforce exercise called Cruzex V. The maneuvres boast their own website in English where you can follow the developments. The French are there too, showing off a couple of their state-of-the-art Rafale fighters, that it hopes to sell to Brazil any moment.

France has asked to have bilateral talks with Brazil on the sidelines of next week’s G20 summit in South Korea over Brasilia’s long-running multi-billion-dollar tender to buy 36 new fighter jets (DefenseNews).

According to DefesaNet, Rafale International has already signed letters of intent for 67 projects with 38 Brazilian companies and organizations representing more than 160% of contract value of the aircrafts. Embraer engineers have participated in meetings in Brazil and France to detail the cooperation between the consortium and the Brazilian industry. Rafale International also offers industrial and technological cooperation for the development of the military transport aircraft KC-390 for which the French government has already pledged to buy a dozen units (DefesaNet).

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With it’s thriving economy and growing middle class, Brazil is becoming more attractive to foreign investment. To do business in Brazil however, it is essential to set up a registered company, and while new options exist it is not a process free of legal hurdles. The Rio Times looks at the options.

Fears among some analysts of an impending Brazilian real estate ‘bubble’ that could burst with familiar results appear to be intensifying as foreign capital continues to pour into the country. This bubble is seen as affecting not just realty circles, but the wider Brazilian economic environment (The Rio Times).

Global investors are pumping so much money into Latin America the region could enter a new boom and bust cycle, with policymakers from Brazil to Mexico on the lookout for bubbles in their markets and economies (Reuters).

The Brazilian Confederation of Industry, CNI, is strongly lobbying president-elect Dilma Rousseff who takes office next January first to adopt additional measures to help contain the strong appreciation of the Real vis-à-vis the US dollar. In fact Brazilian exporters ask Rousseff for a US dollar between 2 and 2.2 Real (MercoPress).

AGRI

Brazil’s state development bank BNDES said it opened a fund worth 1 billion reais ($588 million) that will finance projects to reduce deforestation associated with the nation’s booming agricultural sector (Reuters).

AVIATION

Embraer, the world’s largest maker of regional aircraft, is building a business jet assembly facility in Melbourne, Florida, the company’s first manufacturing plant in the United States (Reuters).

Embraer has won a competition held by the Indonesian Ministry of Defense to supply eight Super Tucano light attack turboprops for the Indonesian Air Force. The deal includes ground support stations and an integrated logistics package, and represents the debut of the Super Tucano in the Asia Pacific region. Deliveries will begin in 2012 (Embraer pdf).

BANKING

Banco PanAmericano’s rescue package is unlikely to spark a rout in Brazilian financial markets as the event is seen as an isolated case of corporate governance flaws (Reuters).

Banco Bradesco, Brazil’s second-largest private-sector bank, plans to open brokerage offices in Hong Kong and Tokyo, looking to offer new services and lure more business in the region (Reuters).

INFRA

The Board Directors of the Brazilian Development Bank (BNDES) approved the financing conditions to be offered in the High-Speed Train (TAV) project, which will make the connection between the cities of Rio de Janeiro, São Paulo and Campinas. The maximum share of public resources for funding will amount to R$ 19.977 billion (BNDES).

Major oil companies like BP and Royal Dutch Shell detailed plans to continue investing signifcantly in the Brazilian sugarcane ethanol industry during the World Ethanol Conference. According to the head of strategy at BP Biofuels, James Primrose, the company “intends to increase its presence in the Brazilian market due to sugarcane’s great potential to form material and cost competitive sources of supply” (UNICA).

OIL

With the recent Libra oil field discovery promising reserves of up to fifteen billion barrels of oil and Sinochem and BP coughing up billions for space in the Campos Basin, there is little doubt that Brazil is the place to be for the upstream oil giants. But the Brazilian oil market is intimidating for newcomers. Industrial tariffs, bureaucracy, a dominant national oil company and tightening regulations on foreign participation can make setting up shop and getting contracts nearly impossible (The Rio Times).

Petrobras has jumped from sixth to fourth place in the ranking of the 250 biggest global energy companies, published by the Platts agency, a world leader in energy and commodities information. Petrobras is the only Latin-American company listed in the top ten (Brazil Weekly).

Petrobras said it had signed deals worth $3.46 billion for the construction of eight platform hulls to tap its huge offshore oil fields. Petrobras said it and partners BG Group, GALP Energia and Repsol had signed two contracts for the platforms with Brazilian infrastructure firm Engevix Engenharia SA for use in the first phase of production in the deepwater Santos Basin subsalt area (Reuters).

Vale announces that Valepar, its controlling shareholder, has nominated Ricardo José da Costa Flores for the chairmanship of Vale’s Board of Directors. As a consequence, Mr. Flores’ name will be submitted to Board approval in its next meeting that will take place on November 25, 2010 (Vale).

Brazil’s incoming government is unlikely to raise mining royalties, the chief executive of mining company Vale said, playing down market talk about a possible royality hike (Reuters).

POWER

Eletrobras, Brazil’s biggest power holding utility, will invest at least 45 billion reais ($27 billion) between 2010 and 2014 as it seeks to improve the nation’s aging electricity grid and expand overseas (Reuters).

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Render of the Bossa Nova twin residential towers currently under construction in the city of Fortaleza, Ceara state (more pics).

CURITIBA

The Rio Times goes down south to Curitiba, capital city of the state of Paraná, as our series examining the 2014 FIFA World Cup city hosts draws to a close. The former capital of Brazil (the city held the honor for all of three days in March 1969), is a far cry from many of the cities we have explored in this series (The Rio Times).

The expansion of the favelas of Rio is a heavily discussed topic. The rapidly growing slum areas provide homes for a rising number of people at an alarming rate, at the expense of the surrounding rainforest. However, the actual process of building a house in a favela often takes years of patience and hard work (The Rio Times).

If you are looking for music, culture, and numerous nightlife options, you can count on finding it all in Lapa. The diversity in Lapa serves as its own niche for tourists looking to have a complete cultural, less ostentatious (and beachless) experience in the marvelous city (The Rio Times).

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SAO PAULO

The Rio Times reviewed what the housing market offered with a R$700K budget in Rio de Janeiro, and now they ‘re upping the stakes to see what R$1 million will afford in São Paulo. Following last week’s review of what R$300K can buy in Brazil’s largest city; The Rio Times take a look what SP has to offer, apartment wise, further up the price scale.

EDUCATION & RESEARCH

The precarious schooling of Brazilians helps sustaining social disparities and imposes severe obstacles to the country’s economic development. That is what Jailson Bittencourt de Andrade, professor of the Federal University of Bahia (UFBA) and member of the Brazilian Science Academy (ABC), stated during a public hearing at the Committee on Science, Technology, Innovation, Communication and IT (Senado Federal).

A worrying situation for Science and Technology in Brazil was pointed out by participants of the public hearing that celebrated the World Science Day for Peace and Development in the Senate. Indicators such as the decrease in the number of researchers who work in companies, the stagnation of Brazilian participation in patents’ record in the world and the decrease in the number of people who finish their studies in federal universities were named as symptoms of crisis in the area (Senado Federal).

General Electric Co, plans to invest $500 million in Brazil to build a research center and expand its operations in Latin America’s largest economy (Reuters).

SOCIAL

Brazil, the country with most territory in Latin America also has the largest population, almost 186 million according to preliminary figures from the latest census, released by the Brazilian Geography and Statistics Institute, IBGE. The exact figure is 185.712.000 and represents a 9.5% increase over the last census in 2000. However this was 3% less than the 191.5 million calculated by IBGE for this year based on birth and death rates and immigration figures (MercoPress).

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Lula propelled Dilma Rousseff from obscurity to the presidency. Continuing his work while proving she is her own woman will not be easy. The Economist analyses the new president of Brazil.

The woman elected to be Brazil’s first female president has promised to make gender equality a priority. Dilma Rousseff said she wanted parents to be able to tell their daughters: “Yes, a woman can” (BBC).

Despite the assertions of her critics, the woman already known to Brazilians simply as Dilma is no beginner. Those critics and some of her soundly defeated opponents are fond of saying that because she had never run before for elected office she might not have the political skills to manage Brazil’s fractious Congress or even her ten party coalitions. But this overlooks the long and remarkable road that brought her from being a guerilla combating Brazil’s military regimes of the 1960s to jail and torture, to getting her degree in economics to a path of local government leading to Lula’s cabinet to his invaluable chief of staff (Foreign Policy).

Another author in the same magazine is waiting for the Dilmismo to begin (Foreign Policy).

Ahead of the presidential, congressional and state elections on 3 October, BBC Brasil asked a range of experts for their views on the challenges facing the country’s next leader (BBC).

“Rousseff will have much more work to do than Lula. Fortunately for Brazilians, this suits her style and personality. Unfortunately for Rousseff, the more she acts, the more she will divide interests and the more rapidly her popularity will erode”. Read the full column of Alexandre Marinis at Bloomberg.

Dilma Rousseff named a market-friendly transition team as she prepares to take the helm of a booming economy threatened by heavy government spending and an overvalued currency (Mercopress).

Some key names in her inner circle who could get cabinet posts, based on information from sources close to Rousseff and analysts, can be found at Reuters.

German editorialists were left pondering what a Rousseff presidency would really look like, and several encouraged the newly-elected leader to follow in the footsteps of the man US President Barack Obama has called “the most popular politician on Earth” (Der Spiegel).

While not all who voted for Marina Silva were necessarily motivated by environment concerns, the environment will inevitably figure prominently in Ms Rousseff’s agenda when she takes office on 1 January (BBC).

Kirchner seemed like the likely winner of Argentina’s next Presidential election, and his death keeps analysts guessing about the country’s future. Argentina’s troubles provide a powerful lesson to Brazil. They reaffirm Brazil’s strategy of betting on institutions, and not on individuals, to keep the country on track (Post-Western World).

Expansive government spending, growing intervention in natural resource industries such as oil and mining, and volatile political support for Rousseff are among the risks to watch in Brazil over the next year (Reuters).

INTERNATIONAL

Brazil will be looking to fight a “currency war” it sees underway between the United States and China that is threatening its export sector, President Luiz Inacio Lula da Silva said (France24).

Dilma said she hoped for mutual respect in her relationship with the United States and praised US President Barack Obama (France24).

A draft resolution bill of the National Congress to renew and expand the Brazilian representation in the Mercosul Parliament (Parlasul) will be in the agenda of the first session after the elections of the collegiate, scheduled for November 10 (Senado Federal).

Following the death of former Argentine president Nestor Kirchner, the Union of South American Nations, Unasur must find a new consensus leader and the outstanding figure and possible candidate is Brazilian president Lula da Silva recognized as a great promoter of regional integration (Mercopress).

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Brazilian and Argentine Defense ministers Nelson Jobim and Nilda Garré
signed a Declaration of Intent regarding the South American neighbor’s participation in the development program of the Embraer KC-390 military transport jet. Chile, Colombia, Portugal, and the Czech Republic have already begun discussions to establish the conditions for their participation in the development and production of the new military transport jet. In July, the Brazilian Air Force revealed its intention to acquire 28 of the jets. With Argentina joining the negotiations, this could result in the aggregated sale of 60 KC-390 airplanes to the air forces of these six countries (Embraer, pdf).

Sao Paulo’s Federal Prosecution has opened a process to determine the alleged responsibility of four retired military personnel accused of involvement in six killings and torturing 20 people among which president-elect Dilma Rousseff (Mercopress).